University of Exeter: New analysis shows “dire” supply and affordability gaps for housing in Cornwall
Researchers who examined postcode-level data found there are few postcodes in the Duchy where mortgage or rental prices are within the means of people earning the average income for the area.
They found six “affordable” postcodes – where there was no gap between the maximum average lending and median annual income. But only 12 properties were sold in these postcodes between mid-2021 and 2022, Land Registry records show.
The University of Exeter study, from experts at the Institute of Cornish Studies, Social and Economic Research Unit, shows there were 246 terraced houses sold in the cheapest six postcodes during the same period, but there was an affordability gap in all those areas.
Camborne was the lowest priced location and had an affordability gap of just under £11,000. The most expensive location for buying a flat was Port Isaac/ St.Endellion with a mortgage gap of £441,674.
The only locations where there was positive affordability for renting, based on the median monthly salary, were Redruth, St. Austell and Liskeard but there were only 14 properties available for rent on Rightmove in those towns.
Professor Malcolm Williams, who led the study, said: “This data shows a dire situation in Cornwall. As of 2018 Cornwall’s population was 565,968, but on the 30th of June 2022 only 171 properties were advertised for rent across Cornwall. In May 2019 there were 395 homes for rent on the same site.
“The ‘cheapest’ rents were for rented rooms within shared flats, but the average cost was £889. The three cheapest postcode areas – St Austell, Redruth and Liskeard – provided affordable housing, but there were only 13 properties available.
“Our research shows long term Cornish residents are competing in a property market where prices for renting and buying bear no relation to wages. Higher salaries are unlikely to help significantly as there is also an issue with supply and the areas with more housing available can be the most expensive.”
Cornwall Council calculates mortgage availability via the house price to income ratio, where the mean house price is divided by the nominal disposable income per head. This method relies on knowing the disposable income per head or per household.
Academics used another method – the affordability ‘gap’ which is the gap between the maximum average lending and median annual income – to see if they found different results. They used the mean price per postcode for terraced housing or flats in from June 2021 to the end of May 2022 and the median annual income for those living in Cornwall. They used the aggregated median full and part time income for those resident in Cornwall, to best reflect the earnings patterns for individuals and then multiplied by 1.5 to derive an approximate gross household income.
For renting academics used the Halifax formula for calculating affordability, which is based on net income.
The most expensive areas for flats were Wadebridge, with an affordability gap of £331,639, Downderrry with £253,591, Fowey- Polruan with £242,883, St.Ives with £229 878, Mousehole – St.Buryan with £220,478 and Falmouth with £219,765.
The least expensive places to buy flats were St.Cleer- Pensilva where the affordability gap was +£70,784, the Lizard +£62,872, Clay District £+60,534, Camborne +£41,284, Liskeard +£40,247, Boscastle – Lesneweth +£35784. Only 20 flats were sold in all these areas during May 2021 and June 2022, although it is likely there are few flats among the housing stock in these parts of Cornwall.
The areas with the largest numbers of flats sold were Newquay, which had an affordability gap of £160,891, St.Ives- Carbis Bay, with an affordability gap of £193,238 and Falmouth with £219,765.
The most expensive locations to buy a terraced house were Port Isaac- St.Endellion, which had an affordability gap of £441,674, St.Ives with £360,286, St.Mawes- Porthscatho with £341,847 and Fowey-Polruan with £309,638.
The least expensive places to buy a terraced house were Camborne, with an affordability gap of £10,843, Looe-Pelynt with £35,209, St. Austell Bay with £38,758 and Bodmin with £41,063.